Oil prices are forecast to remain at levels that should deliver good profits for producers and sustain strong investment in the North Sea this year but will likely mean continued pain at the petrol pump for motorists.
While the outlook for the global economy is shrouded in uncertainty, experts believe oil and gas markets will stay firm in 2013, meaning that the price of Brent Crude should remain around current levels.
Ann-Louise Hittle, head of macro oils at Wood Mackenzie, said the Scottish oil and gas consultancy expects Brent to average $108 per barrel in 2013 compared with its forecast of $112pb in 2012. The forecast for this year is based on three key assumptions.
She said: "That's based on sanctions against Iran continuing through 2013 at the current level, so no further ratcheting up; that's important. It's also based on there not being a military attack on Iran during 2013 and last, but not least, it's based on a GDP outlook that shows in 2013 we avoid a fall into recession globally and even within Europe no worsening of the situation."
Boston-based Ms Hittle said Wood Mackenzie expects GDP to strengthen slightly in the US, on the assumption that the fiscal cliff stand-off is resolved fully.
The forecast also assumes the strong economies in Europe, such as Germany, are able to continue at about current rates of growth and that China has a slight rise in economic activity from relatively slow levels in 2012.
Hamish Smith, senior economic adviser at Royal Bank of Scotland, said crude prices were likely to remain in line with the levels seen in 2012.
He expects US politicians to resolve the fiscal cliff problem by agreeing a deal on spending cuts that minimises the short-term impact on the US economy.
However, Mr Smith warns that this is unlikely to be an easy task given the current nature of US politics.
He says the oil price forecast would need to be assessed against any material change in circumstances. Barring such a change, growth in the US and faster expansion in the Chinese economy should compensate for the fall in demand which Mr Smith predicts will result from continued problems in the eurozone.
Massimo Di Odoardo, principal analyst, European Gas and Power Research at Wood Mackenzie, said gas prices in the UK North Sea are likely to be underpinned by strong demand from Asia and limitations in global Liquefied Natural Gas capacity. These make it hard to ship supplies of gas from areas in which prices are lower, like the US, into higher price areas.
Both Wood Mackenzie and Royal Bank of Scotland believe the crude prices they forecast are high enough to encourage oil and gas firms to maintain the high levels of investment that have been recorded in the UK North Sea in recent months.
"These prices are fine to keep up North Sea activity and other higher cost regions. They are at levels high enough to keep upstream levels moving along at a brisk rate," said Ms Hittle.
Mr Smith noted North Sea production has been falling. This reflects increased maintenance work and field maturity. However, he added: "If prices remain at the levels they are at now it should be positive for investment."
But the news may not be so good for motorists.
"Without a big change one way or the other we do not expect a big change at the petrol pump," said Mr Smith.
Things could get much worse for consumers of oil and gas, at least in the short term, if geopolitical problems lead to supply disruptions.
Ms Hittle believes the big increase in production from shale in the US and oil sands in Canada as well as off Brazil means the market should be able to cope relatively well with the consequences of a contained military strike on Iran.
However, she warned: "Another outcome would be if it were to cause further regional fighting and most importantly some sort of stoppage at the Strait of Hormuz, then with 17 million barrels a day going through Hormuz according to our calculations, if that were to slow down even for a week or two that would have much more upward impact on price.
"Then we'd be looking at up towards, probably above the highs we saw last time (in 2008) which were $147pb for Brent, more towards $170pb, $175pb. But I don't think it would be sustained because ultimately it would have such a dramatic impact on the economy that the sustained level would be closer to the $150pb level."